In September 2012, Governor Brown signed SB 863 into law. This reform of the workers’ compensation system in California included adoption of the IMR process, which went into effect on January 1, 2013, for injuries that occurred in 2013. On July 1, 2013, IMR was available to all injured workers regardless of their dates of injury.

The Department of Industrial Relations (DIR) and its Division of Workers’ Compensation (DWC) have posted an annual report on the Department’s Independent Medical Review (IMR) program. IMR is the medical dispute resolution process for the state’s workers’ compensation system that resolves disputes over medical treatment for injured workers. The report describes IMR program activity in 2024, the twelfth year since the program was implemented.

The Independent Medical Review Organization (IMRO) administering the program, Maximus Federal Services, Inc., received 199,651 IMR applications, and issued 141,621 Final Determination Letters, each addressing one or more medical necessity disputes. Throughout the year, the IMRO issued decisions, on average, six to seven days after receipt of all medical records.

Some highlights of the report are as follows:

– – Nearly 90% of all unique IMR filings were deemed eligible for review, slightly less than the annual percentage for those filed in 2023.
– – Pharmaceutical requests accounted for 33% of all treatment requests sent for IMR, a slightly higher proportion of total service requests than in previous years.
– – Opioids comprised 24% of all pharmaceutical requests.
– – Treatment request denials were overturned at an overall rate of 12.7%, an increase from the previous year (10.2%). The denials that were overturned most often were for evaluation and management services, followed by other programs such as Functional Restoration program, Brain Injury program, Weight loss program, and behavioral and mental health service.
– – Guidelines contained in the Medical Treatment Utilization Schedule continue to serve as the primary resource for the determination of medical necessity.

Expert reviewers may hold licenses to practice in any of the 50 states. Reviewers licensed in California evaluated 81% of the decisions in 2024. This is a lesser proportion than in the previous years, when reviewers licensed in the state evaluated 83% of the decisions issued in 2023, and 87% of the decisions issued in 2022.

Applicants filed an Application for Adjudication, seeking workers’ compensation benefits in connection with the death of decedent Mathew Brabo, who passed away on February 1, 2022. The claim was settled via Stipulations with Request for Award, and an Award issued on December 14, 2022. His employer was the California Department of Forestry Region IV.

As part of the stipulations, the parties noted that, pursuant to Labor Code section 4707, subdivision (a) as it then existed, applicants were not eligible for most workers’ compensation death benefits because they received the CalPERS Special Death Benefit.

On January 1, 2024, section 4707 was amended to add subdivision (c), which removed this limit on workers compensation death benefits for a number of state safety members including firefighters for the Department of Forestry and Fire Protection who are members of Bargaining Unit 8 of the Public Employees’ Retirement System.

This amendment specified that “This subdivision shall be applied retroactively to January 1, 2019, for injuries not previously claimed or resolved, and shall not supersede any statutes of limitations otherwise provided by the Labor Code.’

On September 3, 2024, applicants filed a Petition to Reopen the stipulated award, seeking to amend the award to include the death benefits they contend that they are now eligible for in light of the amendments to section 4707. The WCJ issued his decision, finding that applicants were not eligible for increased death benefits. The WCJ’s decision rested upon his interpretation that the phrase “applied retroactively to January 1, 2019, for injuries not previously claimed or resolved” unambiguously referred to injuries or claims not resolved prior to January 1, 2024, the date of the subdivision’s enactment.

Since applicants’ claim was resolved on December 14, 2022, before January 1, 2024, the WCJ concluded that applicants were not entitled to increased death benefits under the statute.

The WCAB panel granted Reconsideration, and substituted a new order finding that applicants are entitled to amend their award pursuant to sections 5803 and 5804, with the precise amount of benefits awardable deferred for determination at the trial level in the case of Bravo v California Department of Forestry Region IV – ADJ15915611 (March 2025).

The WCAB panel noted that it was “presented with a pure question of law: whether death claims brought by eligible applicants that were resolved after January 1, 2019, but prior to January 1, 2024, may be amended to award the increased death benefits now provided for by that subdivision.”

“We are directed to interpret statutory language “consistently with its intended purpose, and harmonized within the statutory framework as a whole.” (Alvarez v. Workers’ Comp. Appeals Bd. (2010) 187 Cal.App.4th 575, 585 [75 Cal. Comp. Cases 817].)”

And they wrote “we cannot agree with the WCJ that the clause “for injuries not previously claimed or resolved” unambiguously refers to claims and injures not resolved prior to the effective date of the statute, rather than prior to January 1, 2019, the date which immediately precedes it.”

“Happily, it does not appear necessary to definitively resolve this conundrum because, for the reasons outlined below, applicants appear entitled to amend the award to include increased death benefits no matter how the clause in question is interpreted. This is because the Labor Code, in its wisdom, allows for the amendment of an award pursuant to sections 5803 and 5804, as long as five years have not passed from the date of injury and good cause exists for the amendment. (§ 5803, 5804.)’

‘Moreover, it is well-established that a change in the law constitutes good cause to amend an award pursuant to section 5803. (Fireman’s Fund Ins. Co. v. Workers’ Comp. Appeals Bd. (2010) 181 Cal.App.4th 752, 768; see also Brannen v. Workers’ Comp. Appeals Bd. (1996) 46 Cal.App.4th 377, 382.).”

“Accordingly, even if the clause “for injuries not previously claimed or resolved” is meant to refer to injuries not claimed or resolved prior to January 1, 2024, rather than January 1, 2019, applicants are still entitled to amend their award to reflect the increased benefits due under the statute based upon sections 5803 and 5804. This conclusion is reinforced by the final clause of the sentence, specifying that the subdivision “shall not supersede any statutes of limitations otherwise provided by the Labor Code.” Section 5804 contains one such statute of limitations, and the Legislature’s reference shows it was cognizant of such statutes of limitations and did not intend to abrogate them.”

When the COVID-19 pandemic struck, the Board of Trustees of the California State University (CSU) directed that instruction be provided remotely. To comply with this directive, Patrick Krug, a biology professor at California State University Los Angeles, incurred expenses for a computer and other equipment and necessities which CSU declined to reimburse.

Krug sued CSU on behalf of himself and similarly situated faculty, alleging Labor Code section 2802 obligated CSU to reimburse its employees for necessary work-related expenses. CSU demurred, arguing that as a department of the state it enjoyed broad exemption from Labor Code provisions that infringe on its sovereign powers. Krug appealed from a judgment of dismissal entered after the trial court sustained CSU’s demurrer without leave to amend.

In August 2023 the Court of Appeal affirmed the trial court in the Published case of Krug v. Board of Trustees of the Cal. State Univ – B320588 (August 2023).

The California Supreme Court granted review of Krug pending its decision in Stone v. Alameda Health System (2024) 16 Cal.5th 1040 (Stone), after which it remanded the matter back to the Court of Appeal for reconsideration in light of its holding in that case.

After reconsideration in light of Stone, the Court of Appeal again affirmed the trial judgment in the second published opinion of Krug v. Board of Trustees of the Cal. State Univ – B320588A (April 2025)

The Stone Court examined the language, structure, and history of the statutes and wage order at issue to determine whether the Legislature intended to impose their requirements on public employers. Using this framework, the Court addressed the text and history of relevant Labor Code and wage order provisions to concluded that the hospital was exempt from the employees’ claims.

On remand from the Supreme Court, the Court of Appeal on re-review of Krug followed Stone’s analytical framework to determine whether the Legislature intended to exclude public entity employers from the employment expense reimbursement obligations at issue here.

It then concluded that the statutory structure evinces positive indicia that the Legislature intended to exclude government employers from the terms of section 2802. The legislative history of section 2802 also supports the conclusion that the Legislature intended to exclude government employers from its terms. Later legislative history was also in accord when section 2802 was amended in 2000 by Senate Bill No. 1305 (SB 1305).

However no case has applied the reimbursement obligations set forth in section 2802 to a public employer.

“In sum, although the language of section 2802 is silent on whether “employer” denotes both public and private entities, the statutory structure and legislative history provide positive indicia of legislative intent to exclude public employers from the provision’s reimbursement obligations.” … “Therefore, we conclude section 2802 does not obligate CSU to reimburse employees for work-related expenses, without the need to resort to interpretive maxims.”

Legal Aid at Work (LAAW) reached a settlement agreement with the California Employment Development Department (EDD), the state agency responsible for administering unemployment insurance for millions of people who work in California. The case involves a lawsuit challenging the legality of EDD’s policies for informing unemployment insurance claimants of determinations that the claimant cannot receive benefits or needs to repay benefits that the claimant has already received.

The agreement, which still needs court approval, will dramatically increase the likelihood unemployment insurance claimants will promptly learn about negative decisions, understand them, and know how to challenge them. Among other things, the settlement will require the EDD to start sending information about its decisions by email and text message, and will require the EDD to rewrite its notices so they are written at an eighth-grade level.

During the COVID-19 pandemic, millions of Californians accessed unemployment insurance benefits, and the state paid out nearly $25 billion in benefits in 2020 alone. California’s Legislative Analyst’s Office has estimated that between $500 million and $1 billion in benefits go unreceived each year because the EDD improperly denies claims. Other claimants are ordered to repay benefits when they are retroactively deemed ineligible for benefits. These decisions, which can order claimants to repay $10,000 or more in benefits, are often financially crippling. And the decisions are often wrong. Claimants who appeal EDD’s decisions have historically been able to get those decisions reversed on appeal over 50 percent of the time, according to the same LAO report.

The lawsuit, Okamura v. Employment Development Department, was filed in Alameda County Superior Court. It argues that EDD failed to properly notify claimants when their benefits were denied, when they owed money back, or when they were accused of fraud. As noted in the Complaint, some claimants only learned about these decisions after their wages were garnished or their tax refunds were seized. Even when claimants did receive notices, the notices were so confusing that they didn’t understand why they were being charged with an overpayment, or realize that they could challenge the EDD’s decision.

EDD will make many important changes to improve how it notifies people about unemployment benefit decisions, including:

– – Expanded Digital Notifications – EDD will soon send emails, text messages, and online alerts to make sure people know about benefit denials and overpayments. Currently, the EDD only sends these notices to claimants by mail, even though most of the unemployment insurance process is done online and over the phone.
– – Creating Easier-to-Understand Notices – EDD has agreed that notices revised as part of its longer-term modernization effort will be rewritten at an 8th-grade reading level. Currently, notices are drafted at a college-level reading level, making them difficult to understand for most claimants.
– – Using Address Verification Tools – EDD will implement a system to verify claimants’ mailing addresses by cross-checking the National Registry of New Hires, and eventually the United States Postal Service’s National Change of Address database. These changes will reduce instances of lost or delayed communication, especially when the EDD sends notices to claimants months or years after they stopped collecting unemployment insurance benefits.
– – Clearer Information About EDD’s Decision – Notices will provide additional information on why benefits were denied or overpaid. Currently, notices only provide limited information about the EDD’s decision, leaving claimants guessing about why they were denied or required to pay back benefits.
– – Disclosure About Possibility of Waiver of Overpayment – Importantly, the EDD will also start telling claimants who receive Notices of Overpayment that some claimants are eligible for a waiver of the overpayment. On appeal, the California Unemployment Insurance Appeals Board regularly decides that an overpayment must be waived, and claimants do not need to pay back benefits they were not eligible to receive.

Even though this lawsuit was filed as a potential class action, the settlement only requires the four individual named plaintiffs and Legal Aid at Work, an institutional plaintiff, to release their claims. The lawsuit does not affect other claimants’ right to file their own legal claims if they have been affected by EDD’s practices in the past.

The motion for settlement approval and entry of judgment was filed in Alameda County Superior Court. If approved, EDD will begin implementing the agreed-upon changes over the next year.

Billey Ford worked as a security guard for The Silver F, Inc., doing business as Parkwest Casino Lotus (Parkwest) from September 2018 to December 2021.

Upon his hiring, Ford signed an arbitration agreement, pursuant to which he agreed to arbitrate any employment-related disputes. However, the arbitration agreement expressly “does not apply” to claims for workers’ compensation or unemployment compensation, specified administrative complaints, Employment Retirement Income Security Act (ERISA) claims, or, as relevant here, “representative claims under [PAGA].”

In addition to the arbitration clause, the arbitration agreement contains a class, collective, and representative action waiver. It provides: “Except where prohibited by federal law, [Parkwest] and I agree that we expressly waive the right to commence arbitration or to file a complaint in court in the form of a class, collective, or representative action on behalf of others. . . . In the event a court determines this waiver is unenforceable with respect to any claim, then this waiver shall not apply to that claim, that claim must be filed in a court of competent jurisdiction, and such court shall be the exclusive forum for that claim.”

In February 2022, Ford filed a complaint against Parkwest, alleging a single cause of action under PAGA for Labor Code violations suffered by him and by other employees. Ford specifically alleged that Parkwest unlawfully required its employees to undergo mandatory, off-the-clock health screenings prior to the start of their work shifts and, consequently, issued inaccurate wage statements and failed to pay all the wages due to its employees.

Parkwest moved to compel arbitration of Ford’s “individual” PAGA claims (i.e., those arising from Labor Code violations that Ford personally sustained) and to dismiss Ford’s “representative” PAGA claims (i.e., those arising from Labor Code violations suffered by other employees). Parkwest’s motion was based on Viking River Cruises, Inc. v. Moriana (2022) 596 U.S. 639, 648-649 (Viking River). After a hearing, the trial court denied the motion. This appeal followed.

The Court of Appeal affirmed the trial court denial of the motion in the unpublished case of Ford v The Silver F  -C099113 (March 2025).

The issue presented in this appeal is one of contract interpretation, i.e., whether the parties’ arbitration agreement requires arbitration of Ford’s PAGA claims. There is no dispute that while the arbitration agreement generally applies to all employment-related disputes, it specifically excludes “ ‘representative claims under [PAGA].’ ” The parties disagree on how to interpret this exclusion.

Parkwest argues that, under Viking River, PAGA claims are “representative” in two ways: First, all PAGA claims are “representative” in the sense that a plaintiff brings a PAGA claim as an agent or proxy for the state. Second, some PAGA claims are “representative” in the sense that they are predicated on code violations suffered by employees other than the plaintiff. Because the term “representative” has two possible meanings, Parkwest argues the exclusion for “representative claims under [PAGA]” is, at best, ambiguous about whether it was intended to exclude all PAGA claims or only those nonindividual claims that the plaintiff might assert on behalf of other employees. Thus, Parkwest contends, we must apply the FAA’s presumption of arbitrability and construe the agreement to permit arbitration of Ford’s individual PAGA claims.

Ford does not dispute that, under the reasoning of Viking River, the exclusionary clause is ambiguous as to the meaning of the term “representative,” but Ford argues the trial court correctly resolved this ambiguity against Parkwest as the drafter of the arbitration agreement. Ford also argues that because the waiver of “representative” claims is unenforceable, any PAGA claim must proceed in court instead of arbitration.

The trial court, in contrast, found that “the agreement is not reasonably susceptible to an interpretation that ‘representative claims under [PAGA]’ means anything other than all PAGA claims.” Thus, the court concluded that Ford’s PAGA claims were unambiguously excluded from the scope of arbitration.

The Court of Appeal wrote that it was not “persuaded by either party’s position.” Instead, it agreed with the trial court’s interpretation.

“Here, both the waiver and the exclusionary clause use the term ‘representative,’ but only the waiver adds the qualifying phrase ‘on behalf of others.’ This supports our interpretation that the parties intended the phrase ‘representative claims under [PAGA]’ to refer broadly to all PAGA claims, not just those brought on behalf of other employees.”